Picture Canada as a ship, and climate change a storm barreling toward us. Already, the seas are becoming treacherous, and the winds threaten to drive us into the shoals. The gathering storm will reshape not just our climate, but also global markets in profound and unpredictable ways. To weather the storm, we must make deliberate choices that lead to cleaner and more inclusive growth and a resilient and prosperous future for Canada.

Discussion about how to prepare for Canada’s future in the face of climate change is dynamic and ongoing. Canada has joined an increasing number of countries, states, municipalities, and firms setting a goal of reducing greenhouse gas emissions to net-zero by 2050. Some Canadian provinces, territories, and municipalities are establishing their own governance and policy frameworks for long-term emissions reductions.

Yet reducing emissions is just one element of a pathway for Canada to a thriving and prosperous 2050. Yes, Canada must transition to a low-carbon economy alongside the rest of the world. We must also make our communities and infrastructure more resilient to the inevitable impacts of a changing climate, such as more extreme weather and recurring natural disasters. And we must grow the prosperity of Canadians across all regions, all communities, and all socio-economic circumstances.

While these aspirations are clear, the course to that future is not. For many Canadians, climate change remains complex, confusing, and potentially paralyzing. Debates around some climate policy choices—for example, putting a price on carbon pollution—are highly polarized. Debates around others—such as policies that will help us adapt to a changing climate—have received inadequate attention, given the practical benefits it could deliver.

This report tries to bring more clarity to what climate change means for Canada, and the choices we will face. It is a starting point for a deeper, broader, and more constructive conversation about how we can chart a course as a country—through the profound changes ahead—to a resilient and prosperous future with cleaner and more inclusive growth.

First, the report brings more clarity as to the nature of the challenges and opportunities that climate change presents for Canada. What are the main hazards and conditions on the way to 2050?

Canada faces risk from the physical impacts of a changing climate, including floods, heatwaves, wildfires, and sea-level rise. By 2050, under current trends, the impacts of climate change are expected to reduce global GDP by three percent, or US$7.9 trillion, according to a recent estimate by the Economist Intelligence Unit.

Canada will not be immune. Our coastal cities will be swamped by rising seas, threatening property and infrastructure. In the face of more frequent and more severe fire and floods, insurance premiums are poised to rise dramatically, making home insurance unaffordable for many Canadians. Extreme heat puts Canadians’ health at risk, especially for children, elderly, and other vulnerable populations. Impacts in Canada’s North are particularly severe, including the accelerated loss of local food sources and compromised infrastructure from thawing permafrost. The impacts of climate change internationally will also affect Canada—disrupting supply chains, putting stress on the global economy, and even driving mass migration. Parts of Canada may benefit temporarily from a warmer climate but, if we are unprepared, these benefits will be quickly overshadowed by mounting loss and hardship, particularly for the most vulnerable.

Meanwhile, the rest of the world has begun to respond to the threat of a changing climate by implementing new policies. If this trend accelerates, the implications for global markets—and a small trading state such as Canada—will be dramatic. The faster the world reduces emissions, the faster markets and investors shift away from carbon-intensive goods and services.

That transition poses a different set of risks for Canada. Much of Canada’s economy—and the prosperity it generates—depends on sectors that export emissions-intensive products and commodities, such as oil and gas and cement. If the rest of the world transitions quickly, sharp declines in global demand for fossil fuels would depress the price of oil and lead to lower levels of investment in Canada’s oil and gas sectors. Other sectors face similar risks: Canada’s automotive industry, for example, could see plants close as a result of decreasing demand for gasoline-powered SUVs and light trucks, with vehicle manufacturing shifting to foreign plants that produce electric vehicles.

Yet it also presents opportunities. The World Bank estimates that climate commitments in emerging economies alone will create $23 trillion in investment opportunities between 2016 and 2030. If Canada is prepared, its growing cleantech sector could become a significant source of investment, innovation, and employment. Surging domestic and global markets would create demand for low-carbon innovation, and technologies, goods, and services that reduce emissions. Meanwhile, conventional sectors, such as mining and forestry, could benefit from an unprecedented increase in global demand for raw materials.

Looking ahead, Canada has choices to make about how—and how much—to reduce emissions, adapt to the changes around us, and invest in future economic opportunities. We are a big, northern country with a dispersed population, warming at twice the rate of the rest of the world. We are also a small, trade-dependent economy susceptible to global economic downturns, supply chain disruptions, and fluctuating commodity prices. How we choose to navigate the threats and opportunities presented by those two realities will have profound implications for the next generation of Canadians.